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Blockchain for Business 2019

You're reading from  Blockchain for Business 2019

Product type Book
Published in Jan 2019
Publisher
ISBN-13 9781789956023
Pages 258 pages
Edition 1st Edition
Languages
Concepts
Author (1):
Peter Lipovyanov Peter Lipovyanov
Profile icon Peter Lipovyanov

Table of Contents (17) Chapters

Preface Bitcoin, Blockchain, and Cryptoassets A Brief History of Money The Birth of Bitcoin and the Advantages of a Decentralized Payment System Five Forces of Bitcoin - #1 Blockchain Five Forces of Bitcoin - #2 Cryptography Five Forces of Bitcoin - #3 Consensus Algorithm Five Forces of Bitcoin - #4 P2P Network Five Forces of Bitcoin - #5 Software Code Base How Ethereum Took the Idea of Blockchain to the Next Level Ethereum - A Global Platform for Decentralized Applications Blockchains Focused on Specific Sectors and Use Cases Corporate Blockchains The Disruptive Potential of Blockchain Technology Blockchain and AI Current Issues and Potential Solutions to Take Blockchain to the Next Level Other Books You may Enjoy

The Proof-of-Work consensus algorithm

Now that you know the problem, let's see the solution, which is called the Byzantine fault tolerance algorithm. This algorithm involves game theory and math.

The first and foremost practical implementation of the Byzantine fault tolerance algorithm came with the Bitcoin's Proof-of-Work. In this case, the generals are nodes on the Bitcoin network, also known as miners. A network node is a connection point that can receive, create, store, and send data across a network. In other words, nodes are the connected dots that make up a network.

The important concept to grasp here is that these mining nodes start from the assumption that nobody else on the network can be trusted.

The Proof-of-Work algorithm guarantees network consensus even in the presence of Byzantine non-compliant nodes. Let's see how this mechanism works in Bitcoin...

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